Japanese electronics giants in North Jersey under pressure

Sharp's Mahwah workforce of about 500 is down from at least 900 in the years after the company moved from Paramus in 1985.

Massive losses. Plummeting share prices. Thousands of layoffs.

They are telltale signs that the Japanese corporate parents of three of North Jersey's most prominent corporate neighbors are in trouble.

Once paragons of innovation and efficiency, Sharp, Sony and Panasonic are struggling against South Korean competition, changing consumer tastes, lack of innovation and heavy pension obligations to maintain a diminishing share of the electronics market they once dominated.

For decades, they have been North Jersey fixtures, employing thousands of administrative, sales, marketing and distribution employees to sell their products across America: the U.S. division of Sharp Electronics has its headquarters in Mahwah; Sony Corp. of America has offices in Teaneck and Park Ridge; and Panasonic Corporation of North America has its U.S. headquarters in Secaucus.

Yet each is smaller than it once was: together they now employ just over half the 3,000 workers that were on their payrolls less than a decade ago. The North Jersey locations appear to be holding their own in the face of recent job cuts overseas. But their employment levels could easily shrink further if the flagging fortunes of their ailing corporate parents force more cuts.

"They have gone from dominating the world, and having some of the most valuable brand names, to companies that are really struggling," said Jordan Selburn, senior principal analyst for consumer electronics at the global research company IHS. "And in Sharp's case, struggling to a horrific extent, where the company's future is in question."

Tokyo-based Sharp said last month that it expects to lose $5.6 billion for the year ending March 2013 and added that "there exist conditions which might raise uncertainties about Sharp being an assumed going concern." The company added, however, that it had taken steps to remove that uncertainty.

Osaka-based Panasonic cut 36,000 mostly factory jobs — one third in Japan and the rest overseas — in its 2012 fiscal year, and its finance chief, Hideaki Kawai, said last month that the company expects to cut another 10,000 jobs by March. On Oct. 31, Panasonic revised its forecast for the 2013 fiscal year from a profit of $600 million, to a loss of about $9.5 billion. The same second-quarter release, in what may be good news for Panasonic's American employees, reported that the company's U.S. sales rose 1 percent while sales fell in all its other markets — Asia, China and Europe.

In April, Tokyo-based Sony Corp. announced that it would lay off 10,000 workers by March 2013. Last month, Moody's Investors Service cut Sony's long-term debt rating to one grade above junk status and gave the electronics company a negative outlook, despite its reporting a small quarterly profit in September after four years of annual losses.

Share prices of all three Japanese companies have fallen by a half since the year began.

But so far, the companies have given little indication what the dramatic changes ahead for the companies could mean for their North Jersey offices.

Panasonic spokesman Jim Reilly said the company would not comment, and Sony did not respond to requests for comment.

"There is no denying the company is facing a challenging environment," said Mark T. Viken, vice president of marketing at Sharp's Mahwah headquarters. He added that Sharp has already "put in place a restructuring plan to address this," including "cost reductions, establishing new alliances and launching new products."

Sharp's Mahwah workforce of about 500 is down from at least 900 in the years after the company moved from Paramus in 1985 to a three-story office and warehouse on the site of the former Ford plant. In 1993 the company was the biggest seller of fax machines to the U.S., a market largely wiped out by the Internet.

Viken said Sharp has made no job cuts in Mahwah over the last three years due to the challenges the company is facing. The U.S. business is "strong," he said, with its Aquos brand leading the market for televisions with 60-inch or more screens and a new line of new multi-function printers and other products being launched.

Established presence

Panasonic moved to Secaucus in 1974, with sales, marketing, manufacturing and corporate employees. By the early-1990s, with nearly 2,000 employees on site, the company was the second-biggest seller of fax machines.

But the workforce has since slimmed to about 950 and could go down further in the move to a new headquarters under construction in Newark. A state tax-break of $102.4 million requires the company to employ 1,000 workers at the headquarters, but it could get 80 percent of that as long as more than 250 employees work there.

Sony, which once had six North Jersey offices with 2,000 employees, said in 2009 that it would shed 170 sales, marketing, engineering and other employees from a Teaneck office and the U.S. headquarters in Park Ridge it has occupied since at least the mid-1980s. That reduced the workforce at the two offices to about 730. And in 2011, the company cut 70 jobs from a music division in Lyndhurst and shut a South Jersey CD factory, laying off 300 workers.